Intel First-Quarter Business Within Expectations

Company Narrows Revenue Range to Between $8.0 Billion and $8.2 Billion

SANTA CLARA, Calif., March 4, 2004 -- Intel Corporation today narrowed its revenue expectation for the first quarter to between $8.0 billion and $8.2 billion, as compared to the previous range of $7.9 billion to $8.5 billion. The gross margin percentage is expected to be 60 percent, plus or minus a point, as compared to the previous expectation of 60 percent, plus or minus a couple of points.

Demand for the company's Intel Architecture products is consistent with the lower end of normal seasonal patterns and significantly higher than in the same period last year. Demand for Intel's communications products is in line with the company's expectations at the beginning of the quarter. All other expectations are unchanged.

This information was provided as part of a scheduled update to the company's Business Outlook for the quarter, which ends March 27. Intel's first-quarter Business Outlook was originally published in the company's fourth-quarter 2003 earnings release, available at www.intc.com. The company will discuss this update during a public webcast at 2:30 p.m. PST today at www.intc.com, with a replay available until April 13.

This Business Update and the Jan. 14 Business Outlook are forward looking and involve a number of risks and uncertainties. Demand for Intel's products, which impacts revenue and the gross margin percentage, is affected by business and economic conditions as well as computing and communications industry trends and changes in customer ordering patterns. Revenue and the gross margin percentage are affected by competing chip architectures and manufacturing technologies, competing software-compatible microprocessors, pricing pressures and other competitive factors, as well as market acceptance of Intel's new products, the availability of sufficient inventory to meet demand, the availability of externally purchased components and the development and timing of introduction of compelling software applications and operating systems that take advantage of the features of Intel's products. Future revenue is also dependent on continuing technological advancement, including developing and implementing new processes and strategic products, as well as the timing of new product introductions, sustaining and growing new businesses and integrating and operating any acquired businesses. In addition to the impact of changes in revenue, the gross margin percentage varies with product mix and pricing, changes in unit costs, capacity utilization and the existence of excess capacity, and the timing and execution of the manufacturing ramp, including the ramp of 90-nanometer process technology on 300-millimeter wafers, and associated costs. The gross margin percentage could also be affected by excess or obsolete inventory, variations in inventory valuation, and impairment of manufacturing or assembly and test assets. Intel conducts much of its manufacturing, assembly and test, and sales activities outside the United States and is thus subject to a number of other factors, including currency controls and fluctuations, tariff and import regulations and regulatory requirements which may limit Intel's or its customers' ability to manufacture, assemble and test, design, develop or sell products in particular countries. If terrorist activity, armed conflict, civil or military unrest or political instability occurs in the United States, Israel or other locations, such events may disrupt manufacturing, assembly and test, logistics, security and communications, and could also result in reduced demand for Intel's products. The impacts of major health concerns or of large-scale outages or interruptions of service from utility or other infrastructure providers, on Intel, its suppliers, customers or other third parties could also adversely affect Intel's business and impact customer order patterns. Expenses, particularly certain marketing and compensation expenses, vary depending on the level of revenue and profits. The expectation regarding gains or losses from equity securities and interest and other assumes no unanticipated events and varies depending on equity market levels and volatility, gains or losses realized on the sale or exchange of securities, impairment charges related to non-marketable and other investments, interest rates, cash balances, and changes in fair value of derivative instruments. Expectations of impairment charges on investments are based on experience, and it is not possible to know which specific investments are likely to be impaired or the extent or timing of individual impairments. The tax rate expectation is based on current tax law and current expected income, and assumes Intel continues to receive tax benefits for export sales. The tax rate may be affected by the closing of acquisitions or divestitures, the jurisdiction in which profits are determined to be earned and taxed, and the ability to realize deferred tax assets. Results could also be affected by adverse effects associated with product defects and errata (deviations from published specifications) and by litigation, such as that described in Intel's SEC reports, as well as other risk factors listed in Intel's SEC reports, including the report on Form 10-K for the year ended Dec. 27, 2003.

About Intel
Intel (NASDAQ: INTC) is a world leader in computing innovation. The company designs and builds the essential technologies that serve as the foundation for the world’s computing devices. Additional information about Intel is available at www.intel.com/pressroom and blogs.intel.com.

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